NPA

SARFAESI: Steps to be Followed for Effective NPA Management

Income Tax - Securitisation and Reconstruction of  Financial Assets & Enforcement of Security  Interest Act, 2002 (SARFAESI) is basically is an act which provides different options to Banks and  Financial Institutions for resolving their non performing assets  and it is also an effective tool in the hands of the lenders to enforce the security...

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बेड बैंक स्थापित करने का रास्ता हुआ साफ: क्या बढ़ते एनपीए पर लग सकेगी लग़ाम?

Income Tax - आखिरकार एसबीआई के चेयरमैन खारा ने 28/01/2022 को पुष्टि की बेड बैंक की अगले महीने तक शुरू होने की. चेयरमैन दिनेश खारा ने कहा कि प्रस्तावित ...

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Final Accounts of Banking Companies- NPA Norms

Income Tax - Following are the important Final Accounts of Banking Companies as per Banking Regulation Act 1949 and its latest Amendments and Reserve Bank of India’s Circulars. 1. Balance Sheet 2. Profit and Loss Account Now, Banks need not follow Ind AS. The relevant position is as follows. On 1st April 2019 – Mandatory Basis — (as […]...

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How good will be India’s Bad Bank?

Income Tax - Since our country’s financial system is predominantly bank-based, non-performing Assets (NPA) of Banks have significant impact on the country’s GDP. NPAs also generate a vicious cycle of effects on the sustainability and growth of the banking system, and if not managed properly could lead to bank’s failure. Mounting NPA is a serious...

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Budget Remedy for Non-Performing Assets (NPA)

Income Tax - THE IDEA OF BAD BANK BY WAY OF ASSET RECONSTRUCTION COMPANY (ARC) Governor of Reserve Bank of India Shaktikanta Das during the question-and-answer session at the 39th Palkhivala Memorial Lecture said, ‘If there is a proposal to set up a bad bank, the RBI will look at it’. The Union Budget presented on 1st February […]...

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Recovery against Gross NPAs improves to 14.69% in FY 2019-20

Income Tax - Gross non-perofrming assets (NPAs) improves from 11.33% in FY2017-18, to 13.52% in FY2018-19, to 14.69% in FY2019-20 As per Reserve Bank of India (RBI) data, recovery made by public sector banks (PSBs) during the financial year as a percentage of gross non-performing assets (NPAs) as on beginning of the financial year (FY) has improved fr...

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Press release about ABG Shipyard issue by SBI

Income Tax - ABG Shipyard was incorporated on 15 March 1985, has been banking arrangements since 2001. Financed under Consortium arrangement over a two dozen lenders. Leader in Consortium was ICICI Bank. Due to poor performance, account became NPA on 30/11/2013. Several efforts were made to revive the company operations but could not succeed. Account ...

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Gross NPA of scheduled commercial banks declined

Income Tax - Gross non-performing assets of scheduled commercial banks have declined As per Reserve Bank of India (RBI) data on global operations, gross non-performing assets (GNPAs) of scheduled commercial banks (SCBs) have declined from Rs. 9,33,779 crore (GNPA ratio of 9.07%) as on 31.3.2019  to Rs. 8,00,463 crore (GNPA ratio of 6.93%) as on 30.9...

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COVID19 Regulatory Package – Asset Classification & Provisioning Clarification

Income Tax - We advise that as per the circular dated April 17, 2020 on asset classification and provisioning, in respect of all accounts classified as standard as on February 29, 2020, even if overdue, the moratorium period, wherever granted, shall be excluded by the lending institutions from the number of days past-due for the purpose of asset class...

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NPAs of Nationalised Banks started declining 

Income Tax - Loans written-off from Balance Sheets of PSBs; As A result of Government’s 4R’s Strategy of Recognition, Resolution, Re-capitalisation and Reforms, NPAs of Nationalised Banks have started declining ...

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ITAT deletes addition for interest accrued on non-performing assets

ACIT Vs. Davangere District Central Co-operative Bank Ltd (ITAT Bangalore) - ACIT Vs Davangere District Central Co-operative Bank Ltd (ITAT Bangalore) We find that in both these years, the only issue involved is regarding the addition made by the AO on account of interest accrued on non-performing assets (NPA) which was deleted by CIT(A). This addition was deleted by learned...

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Mere Balance Sheet entries not amounts to acknowledgment of Debt under Limitation Act

Bishal Jaiswal Vs Asset Reconstruction Company (India) Ltd. & Anr. (NCLAT Delhi) - Section 18 of the Limitation Act, 1963 would have no application to proceedings under I&B Code. Therefore, the issue raised as regards acknowledgement of liability by reflection in the Balance Sheet/ Annual Return would be irrelevant....

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Interest accrued on NPA not taxable in computation of Taxable Income of Bank

CIT Vs Davangere District Central Co-Operative Bank Limited (Karnataka High Court) - The issue under consideration is whether Tribunal is right in deleting the interest accrued on non performing assets from the computation of taxable income for the assessment year under consideration despite the assessee maintaining mercantile system of accounting?...

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Interest on NPA loan can be taxed on receipt basis only

Chitradurga District Co-Op. Central Bank Ltd. Vs DCIT (ITAT Bangalore) - DCIT Vs. Chitradurga District Co-Op. Central Bank Ltd. (ITAT Bangalore) If an assessee adopts the mercantile system of accounting and in his accounts he shows a particular income as accruing, whether that amount is really accrued or not is liable to bring the said income to tax. His accounts shoul...

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Not to declare petitioner as NPA till Further Order: SC

Gajendra Sharma Vs Union of India (Supreme Court) - Gajendra Sharma Vs Union of India (Supreme Court ) The issue under consideration is whether the interest will be charged on loan during moratorium period which is declared by RBI due to COVID-19? As per RBI’s circular dated 27th March, 2020 the RBI has extended the moratorium period from June ...

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RBI clarifies on 90 days period’ for determination of ‘out of order’ status of a CC/OD account

RBI/2021-2022/158 DOR.STR.REC.85/21.04.048/2021-22 - (15/02/2022) - The ‘previous 90 days period’ for determination of ‘out of order’ status of a CC/OD account shall be inclusive of the day for which the day-end process is being run. In case of borrowers having more than one credit facility from a lending institution, loan accounts shall be upgraded from NPA...

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Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances – Clarifications

Notification No. RBI/2021-2022/125 DOR.STR.REC.68/21.04.048/2021-22 - (12/11/2021) - The extant instructions on IRACP norms specify that an amount is to be treated as overdue if it is not paid on the due date fixed by the bank. It has been observed that due dates for repayments are sometimes not specifically mentioned in the loan agreements, and instead a description of due dates is...

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Master Circular- Income Recognition, Asset Classification, Provisioning and Other Related Matters – UCBs

RBI/2021-22/117 DOR.No.STR.REC.64/21.04.048/2021-22 - (01/11/2021) - With a view to moving towards international best practices and to ensure greater transparency, '90 days' overdue1 norms for identification of NPAs have been made applicable from the year ended March 31, 2004. As such, with effect from March 31, 2004, a non-performing asset is a loan or an advance wh...

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RBI Resolution Framework 2.0 | Resolution of stress of MSMEs

Circular No. RBI/2021-22/32 DOR.STR.REC.12/21.04.048/2021-22 - (05/05/2021) - In view of the uncertainties created by the resurgence of the Covid-19 pandemic in India in the recent weeks, RBI  decided to extend the facility for restructuring existing loans to MSMEs without a downgrade in the asset classification subject to the some conditions. RESERVE BANK OF INDIA www.rbi.o...

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RBI Circular on Refund/adjustment of ‘interest on interest’ & Asset Classification

RBI/2021-22/17 DOR.STR.REC.4/21.04.048/2021-22 - (07/04/2021) - All lending institutions1 shall immediately put in place a Board-approved policy to refund/adjust the ‘interest on interest’ charged to the borrowers during the moratorium period, i.e. March 1, 2020 to August 31, 2020 in conformity with the above judgement....

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Recent Posts in "NPA"

ITAT deletes addition for interest accrued on non-performing assets

ACIT Vs. Davangere District Central Co-operative Bank Ltd (ITAT Bangalore)

ACIT Vs Davangere District Central Co-operative Bank Ltd (ITAT Bangalore) We find that in both these years, the only issue involved is regarding the addition made by the AO on account of interest accrued on non-performing assets (NPA) which was deleted by CIT(A). This addition was deleted by learned CIT(A) by following the judgment of [&h...

Read More

SARFAESI: Steps to be Followed for Effective NPA Management

Securitisation and Reconstruction of  Financial Assets & Enforcement of Security  Interest Act, 2002 (SARFAESI) is basically is an act which provides different options to Banks and  Financial Institutions for resolving their non performing assets  and it is also an effective tool in the hands of the lenders to enforce the security...

Read More
Posted Under: Fema / RBI |

Recovery against Gross NPAs improves to 14.69% in FY 2019-20

Gross non-perofrming assets (NPAs) improves from 11.33% in FY2017-18, to 13.52% in FY2018-19, to 14.69% in FY2019-20 As per Reserve Bank of India (RBI) data, recovery made by public sector banks (PSBs) during the financial year as a percentage of gross non-performing assets (NPAs) as on beginning of the financial year (FY) has improved fr...

Read More
Posted Under: Fema / RBI |

RBI clarifies on 90 days period’ for determination of ‘out of order’ status of a CC/OD account

RBI/2021-2022/158 DOR.STR.REC.85/21.04.048/2021-22 15/02/2022

The ‘previous 90 days period’ for determination of ‘out of order’ status of a CC/OD account shall be inclusive of the day for which the day-end process is being run. In case of borrowers having more than one credit facility from a lending institution, loan accounts shall be upgraded from NPA to standard asset category only upon re...

Read More

Press release about ABG Shipyard issue by SBI

ABG Shipyard was incorporated on 15 March 1985, has been banking arrangements since 2001. Financed under Consortium arrangement over a two dozen lenders. Leader in Consortium was ICICI Bank. Due to poor performance, account became NPA on 30/11/2013. Several efforts were made to revive the company operations but could not succeed. Account ...

Read More
Posted Under: Fema / RBI |

Gross NPA of scheduled commercial banks declined

Gross non-performing assets of scheduled commercial banks have declined As per Reserve Bank of India (RBI) data on global operations, gross non-performing assets (GNPAs) of scheduled commercial banks (SCBs) have declined from Rs. 9,33,779 crore (GNPA ratio of 9.07%) as on 31.3.2019  to Rs. 8,00,463 crore (GNPA ratio of 6.93%) as on 30.9...

Read More
Posted Under: Fema / RBI |

बेड बैंक स्थापित करने का रास्ता हुआ साफ: क्या बढ़ते एनपीए पर लग सकेगी लग़ाम?

आखिरकार एसबीआई के चेयरमैन खारा ने 28/01/2022 को पुष्टि की बेड बैंक की अगले महीने तक शुरू होने की. चेयरमैन दिनेश खारा ने कहा कि प्रस्तावित ...

Read More
Posted Under: Fema / RBI |

Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances – Clarifications

Notification No. RBI/2021-2022/125 DOR.STR.REC.68/21.04.048/2021-22 12/11/2021

The extant instructions on IRACP norms specify that an amount is to be treated as overdue if it is not paid on the due date fixed by the bank. It has been observed that due dates for repayments are sometimes not specifically mentioned in the loan agreements, and instead a description of due dates is mentioned, leaving scope for different ...

Read More

Master Circular- Income Recognition, Asset Classification, Provisioning and Other Related Matters – UCBs

RBI/2021-22/117 DOR.No.STR.REC.64/21.04.048/2021-22 01/11/2021

With a view to moving towards international best practices and to ensure greater transparency, '90 days' overdue1 norms for identification of NPAs have been made applicable from the year ended March 31, 2004. As such, with effect from March 31, 2004, a non-performing asset is a loan or an advance where:...

Read More

Final Accounts of Banking Companies- NPA Norms

Following are the important Final Accounts of Banking Companies as per Banking Regulation Act 1949 and its latest Amendments and Reserve Bank of India’s Circulars. 1. Balance Sheet 2. Profit and Loss Account Now, Banks need not follow Ind AS. The relevant position is as follows. On 1st April 2019 – Mandatory Basis — (as […]...

Read More
Posted Under: Fema / RBI |

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